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Long-Term Debt | 9 Months Ended
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Sep. 30, 2016
Long-Term Debt [Abstract] |
Long-Term Debt | 7. LONG-TERM DEBT ﻿ Long-term debt and the weighted average interest rates as of September 30, 2016 and December 31, 201 5 consisted of the following: ﻿
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﻿Amounts in thousands |  | September 30, 2016 |  | December 31, 2015
﻿Credit agreement - Bank of Montreal |  | $ | 42,479 |  |  | 4.06% |  | $ | 20,419 |  |  | 5.07%
﻿Capital leases - CRA |  |  | 246 |  |  | 6.45% |  |  | 0 |  |  | 0.00%
﻿Credit agreement - CPL |  |  | 522 |  |  | 3.54% |  |  | 1,647 |  |  | 3.02%
﻿Capital leases - CPL |  |  | 2 |  |  | 63.21% |  |  | 13 |  |  | 27.89%
﻿Financing obligation - CDR land lease |  |  | 14,863 |  |  | 13.73% |  |  | 14,087 |  |  | 12.94%
﻿Capital leases - CDR |  |  | 642 |  |  | 5.32% |  |  | 615 |  |  | 4.57%
﻿Total principal |  | $ | 58,754 |  |  | 8.09% |  | $ | 36,781 |  |  | 8.21%
﻿Deferred financing costs |  |  | (398) |  |  |  |  |  | (261) |  |  |
﻿Total long-term debt |  | $ | 58,356 |  |  |  |  | $ | 36,520 |  |  |
﻿Less current portion |  |  | (5,510) |  |  |  |  |  | (4,123) |  |  |
﻿Long-term portion |  | $ | 52,846 |  |  |  |  | $ | 32,397 |  |  |
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﻿ ﻿ Bank of Montreal Credit Agreement In May 2012, the Company, through its Canadian subsidiaries, entered into the CAD 28.0 million credit agreement with the Bank of Montreal (“BM O”). On August 15, 2014, the Company, through its Canadian subsidiaries, entered into an amended and restated c redit a greement with BMO that increased the Company’s borrowing capacity to CAD 39.1 million. On September 30, 2016, the Company through its Canadian subsidiaries, entered into the BMO Credit Agreement that increased the Company’s borrowing capacity to CAD 69.2 million with an interest rate of BMO’s floating rate plus a margin. As discussed further below, the Company has entered into interest rate swap agreements to fix the interest rate paid related to a portion of the outstanding balance on the BMO Credit Agreement. As of September 30, 2016, the Company had borrowed CAD 63.9 million, of which the outstanding balance was CAD 55.7 million ($42.5 million based on the exchange rate in effect on September 30, 2016) and the Company had approximately CAD 5.2 million ($4.0 million based on the exchange rate in effect on September 30, 2016) available under the BMO Credit Agreement. ﻿ The BMO Credit Agreement consists of the following five credit facilities: ﻿
| 1. |  | Credit Facility A is a CAD 1.1 million revolving credit facility with a term of five years that expires in August 2019. Credit Facility A may be used for general corporate purposes, including for the payment of costs related to the BMO Credit Agreement, ongoing working capital requirements and operating regulatory requirements. As of September 30, 2016, the Company had CAD 1.1 million ($0.8 million based on the exchange rate in effect on September 30, 2016) available for borrowing under Credit Facility A.
| 2. |  | Credit Facility B is an approximately CAD 24.1 million committed, non-revolving, reducing standby facility with a term of five years that expires in August 2019. The Company used borrowings under Credit Facility B primarily to repay the Company’s mortgage loan related to CRA, pay for the additional 33.3% investment in CPL, pay for development costs related to CDR and for working capital and general corporate purposes. Once the principal amount of an advance has been repaid, it cannot be re-borrowed. As of September 30, 2016, the Company had no additional available borrowings under Credit Facility B.
| 3. |  | Credit Facility C is a CAD 11.0 million revolving credit facility with a term of five years that expires in August 2019. Credit Facility C may be used as additional financing for the development of CDR. The Company may re-borrow the principal amount within the limits described in the BMO Credit Agreement. As of September 30, 2016, the Company had CAD 4.1 million ($3.1 million based on the exchange rate in effect on September 30, 2016) available for borrowing under Credit Facility C.
| 4. |  | Credit Facility D is a CAD 30.0 million committed, reducing term credit facility with a term of five years that expires in September 2021. The Company used CAD 30.0 million to pay for the Apex Acquisition. Once the principal amount of an advance has been repaid it cannot be re-borrowed. As of September 30, 2016, the Company had no additional available borrowings under Credit Facility D.
| 5. |  | Credit Facility E is a CAD 3.0 million treasury risk management facility. The Company may use this facility to hedge interest rate risk or currency exchange rate risk. Credit Facility E has a term of five years. The Company is currently utilizing Credit Facility E to hedge interest rate risk as discussed below.
﻿ Any funds not drawn down under the BMO Credit Agreement are subject to standby fees ranging from 0.50% to 0.75% payable quarterly in arrears. Standby fees of less than CAD 0.1 million (less than $0.1 million based on the exchange rate s in effect on September 30, 2016 and 2015) were recorded as general and administrative expense in the condensed consolidated statement s of earnings for each of the three and nine months ended September 30, 2016 and 2015. The shares of the Company’s Canadian subsidiaries that own CRA, CAL and CSA and the Company's 75% interest in CDR are pledged as collateral for the BMO Credit Agreement. The BMO Credit Agreement contains a number of financial covenants applicable to the Canadian subsidiaries, including covenants restricting their incurrence of additional debt, a debt to EBITDA ratio, a fixed charge coverage ratio, a requirement to maintain a CAD 50.0 million equity balance and a capital expenditure limit of CAD 4.0 million per year. The Company was in compliance with all covenants of the BMO Credit Agreement as of September 30, 2016. ﻿ In April 2015, the Company entered into two interest rate swap agreements to partially hedge the risk of future increases in the variable rate debt under the Company’s BMO Credit Agreement. The Company’s two interest rate swap agreements are set at a Canadian Dollar Offered Rate (“CDOR”) of 3.92% and 3.89%, respectively, with terms that expire in August 2019. The notional amount for each of the interest rate swap agreements wa s CAD 9.4 million ($7.2 million based on the exchange rate in effect on September 30, 2016). The interest rate swap agreements are not designated as hedges for accounting purposes. As a result, changes in fair value of the interest rate swaps are recognized in interest expense on the Company’s condensed consolidated statement s of earnings. ﻿ Deferred financing costs consist of the Company’s costs related to the financing of the BMO Credit Agreement. Amortization expenses relating to deferred financing charges were less than $0.1 million for each of the three months ended September 30, 2016 and 201 5. These costs are included in interest expense in the condensed consolidated statements of earnings. ﻿ Century Resorts Alberta As of September 30, 2016, CRA had a capital lease agreement totaling CAD 0.3 million ($0.2 million based on the exchange rate in effect on September 30, 2016) for surveillance equipment. ﻿ Casinos Poland As of September 30, 2016, CPL had debt totaling PLN 2.0 million ($0.5 million based on the exchange rate in effect on September 30, 2016) under two credit agreements and one capital lease agreement. CPL also had a credit facility that had no outstanding balance as of September 30, 2016 and December 31, 2015. ﻿ The first credit agreement is with mBank (formerly known as BRE Bank). Under this credit agreement, CPL entered into a three year term loan in November 2013 at an interest rate of Warsaw Interbank Offered Rate (“WIBOR”) plus 1.75%. Proceeds from the loan were used to repay the balance of the Bank Pocztowy loan related to the CPL properties, invest in slot equipment and relocate the Company’s Poznan, Poland casino. The mBank credit agreement is secured by a building owned by CPL in Warsaw, Poland. As of September 30, 2016, the amount outstanding on the term loan was PLN 0.8 million ($0.2 million based on the exchange rate in effect on September 30, 2016). CPL has no further borrowing availability under the loan, and the loan matures in November 2016. The mBank credit agreement contains a number of financial covenants applicable to CPL, including covenants that restrict the incurrence of additional debt and require CPL to maintain debt ratios and current liquidity ratios of 0.6 or higher. On March 26, 2015, CPL and mBank amended the credit agreement to lower the current liquidity ratio to 0.5. CPL was in compliance with all covenants of this mBank agreement as of September 30, 2016. ﻿ The second credit agreement is also with mBank. Under this credit agreement, CPL entered into a three year term loan on September 15, 2014 at an interest rate of WIBOR plus 1.70%. Proceeds from the loan were used to repay balances outstanding under a prior credit agreement that matured in September 2014 and to finance current operations. The mBank credit agreement is secured by a building owned by CPL in Warsaw, Poland. As of September 30, 2016, the amount outstanding on the term loan was PLN 1.2 million ($0.3 million based on the exchange rate in effect on September 30, 2016). CPL has no further borrowing availability under the loan, and the loan matures in September 2017. The mBank credit agreement contains a number of financial covenants applicable to CPL, including covenants that restrict the incurrence of additional debt and require CPL to maintain debt ratios and current liquidity ratios of 0.6 or higher. On March 26, 2015, CPL and mBank amended the credit agreement to lower the current liquidity ratio to 0.5. CPL was in compliance with all covenants of this mBank agreement as of September 30, 2016. ﻿ The credit facility is a short-term line of credit with BPH Bank used to finance current operations. The bank line of credit bears an interest rate of WIBOR plus 1.85% with a borrowing capacity of PLN 13.0 million, of which PLN 2.0 million may only be used to secure bank guarantees. The credit facility terminates on February 1 1, 201 8. The BPH Bank line of credit is secured by a building owned by CPL in Warsaw, Poland. As of September 30, 2016, there was no outstanding amount on the credit facility, and CPL ha d approximately PLN 11.0 million ($2.8 million based on the exchange rate in effect on September 30, 2016) available under the agreement. The BPH Bank facility contains a number of financial covenants applicable to CPL, including covenants that restrict the incurrence of additional debt and debt to EBITDA ratios. CPL was in compliance with all covenants of th e BPH Bank line of credit as of September 30, 2016. ﻿ CPL’s remaining debt is a capital lease agreement for a vehicle. As of September 30, 2016, the amount outstanding was less than PLN 0.1 million (less than $0.1 million based on the exchange rate in effect on September 30, 2016). ﻿ In addition, under Polish gaming law, CPL is required to maintain PLN 3.6 million in the form of deposits or bank guarantees for payment of casino jackpots and gaming tax obligations. mBank issued guarantees to CPL for this purpose totaling PLN 3.6 million ($0.9 million based on the exchange rate in effect on September 30, 2016). The mBank guarantees are secured by land owned by CPL in Kolbaskowo, Poland and terminate on October 31, 2019. In addition, CPL is required to maintain deposits or provide bank guarantees for payment of additional prizes and giveaways at the casinos. The amount of these deposits varies depending on the value of the prizes. CPL maintained $0.2 million in deposits for this purpose as of September 30, 2016. These deposits are included in deposits and other on the Company’s condensed consolidated balance sheets. ﻿ Century Downs Racetrack and Casino As of September 30, 2016, CDR had debt totaling CAD 20.3 million ($15.5 million based on the exchange rate in effect on September 30, 2016). The debt includes CDR’s land lease and six capital lease agreements. ﻿ CDR’s land lease is a financing obligation of the Company. Prior to the Company’s acquisition of its ownership interest in CDR, CDR sold a portion of the land on which the REC project is located and then entered into an agreement to lease back a portion of the land sold. The Company accounts for the lease using the financing method by accounting for the land subject to lease as an asset and the lease payments as interest on the financing obligation. Under the land lease, CDR has four options to purchase the land. The first option date is July 1, 2023. Due to the nature of the CDR land lease financing obligation, there are no principal payments due until the Company exercises its option to purchase the land. Lease payments are applied to interest only, and any change in the outstanding balance of the financing obligation relates to foreign currency translation. As of September 30, 2016, the outstanding balance on the financing obligation was CAD 19.5 million ($14.9 million based on the exchange rate in effect on September 30, 2016) and the implicit interest rate was 10.0%. ﻿ CDR’s remaining debt consists of six capital lease agreements for equipment used in the operation of CDR. As of September 30, 2016, the amount outstanding was CAD 0.8 million ($0.6 million based on the exchange rate in effect on September 30, 2016). ﻿ As of September 30, 2016, scheduled maturi ties related to long-term debt we re as follows: ﻿
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﻿Amounts in thousands |  | Bank of Montreal |  | Century Resorts Alberta |  | Century Downs |  | Casinos Poland |  | Total
﻿2016 |  | $ | 1,138 |  | $ | 23 |  | $ | 95 |  | $ | 289 |  | $ | 1,545
﻿2017 |  |  | 4,552 |  |  | 95 |  |  | 349 |  |  | 235 |  |  | 5,231
﻿2018 |  |  | 4,552 |  |  | 101 |  |  | 116 |  |  | 0 |  |  | 4,769
﻿2019 |  |  | 15,767 |  |  | 27 |  |  | 43 |  |  | 0 |  |  | 15,837
﻿2020 |  |  | 1,969 |  |  | 0 |  |  | 28 |  |  | 0 |  |  | 1,997
﻿Thereafter |  |  | 14,501 |  |  | 0 |  |  | 14,874 |  |  | 0 |  |  | 29,375
﻿Total |  | $ | 42,479 |  | $ | 246 |  | $ | 15,505 |  | $ | 524 |  | $ | 58,754
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- Definition The entire disclosure for long-term debt. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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